Using a TMV solver You would be borrowing $350,000 for a home loan at 3% interest, but you are given two options: pay off the loan in 30 years, or pay off the loan in 15 years. 1. Compute the payment for each (the 30-year loan and the 15-year loan). 2. Compute the amount paid over the life of both loans (payment amount times number of payments) 3. Compute the total interest paid over the life of both loans (total paid minus amount borrowed). 4. Decide whether you would choose the 30-year or the 15-year loan. Explain
Using a TMV solver You would be borrowing $350,000 for a home loan at 3% interest, but you are given two options: pay off the loan in 30 years, or pay off the loan in 15 years. 1. Compute the payment for each (the 30-year loan and the 15-year loan). 2. Compute the amount paid over the life of both loans (payment amount times number of payments) 3. Compute the total interest paid over the life of both loans (total paid minus amount borrowed). 4. Decide whether you would choose the 30-year or the 15-year loan. Explain
Chapter19: Lease And Intermediate-term Financing
Section: Chapter Questions
Problem 14P
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Using a TMV solver
You would be borrowing $350,000 for a home loan at 3% interest, but you are given two options: pay off the loan in 30 years, or pay off the loan in 15 years.
1. Compute the payment for each (the 30-year loan and the 15-year loan).
2. Compute the amount paid over the life of both loans (payment amount times number of payments)
3. Compute the total interest paid over the life of both loans (total paid minus amount borrowed).
4. Decide whether you would choose the 30-year or the 15-year loan. Explain
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